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Category: Global Economic Meltdown

George Soros predicts that yet another financial crisis could be in the cards for and investors. This not only emphasizes a need for caution within investment, but also an need to be aware of market fluctuations. Billionaire George Soros was interviewed on a forum in Sri Lanka, relating his thoughts on the subject. This interview illustrates that the international struggle for financial stability.

While China attempts to find a new growth model on http://www.nybooks.com/contributors/george-soros/, the country’s currency devaluation is creating international unrest. Soros related that a possible return to positive interest rates will be a challenge for the developing world, paralleling the financial events that unfolded before 2008. The link between global currency, stock , and commodity markets currently seem destabilized as they were in the first week of the new year.

The yuan’s decreasing value is still a concern and there are signs that China’s economy will slowly move from investment and manufacturing, two industries that have dominated the Chinese sectors. The middle class is now promoting consumption and services. China will also suffer as $2.5 trillion was taken from total global equities this year through Wednesday. Losses in the market only increased within Asia on Thursday due to halted Chinese equities.

Soros described China has having “a major adjustment problem,” This inability to adjust has produced a volatile environment that seems unlikely to get any better. George Soros has had successful predictions regarding the market before, so analysts are ready to take heed. Investment in the yuan may also be risky due to political situations within the country. He points a comparison to Greece, which suffered such a serious financial crisis around 2008 that they country’s national historical treasures were to be sold off for debt compensation.

George Soros, owns a hedge-fund firm that has gained about 20 percent annually from 1969 to 2011, and touts a net worth of about $27.3 billion. Starting his career in the 1950s within New York city, he was able to gain a reputation for investing success in 1992. It was within this time period that George Soros netted 1 billion on the estimate that the U.K. would devalue the pound. George Soros has always had an ability to gage the volatility of markets around the world.

With this information in mind, it is advisable for investors to stay far from the yuan until international markets warrant a lower score on the fear gauge. While the 2008 crisis wiped the slates of many companies and individuals, many analysts may wonder if investors are likely to suffer major losses again, as the word is out and the caution within finance has increased significantly.

George Soros has a way about him that commands respect and attention. He is one of the richest people in the world, and, for the most part, he made his money investing in the global economy. Soros is an expert in global economics, so when he has something to say about the condition of the world people usually listen. They may not agree, but they listen. Soros recently told a Bloomberg interviewer that all the signs for a catastrophic economic meltdown are present, and, at this point, there’s little chance of derailing it.

Soros told the interviewer that the signs have been around for the last three years. The emerging market growth that was fueling global economic growth stalled in last quarter of 2013, and the countries that make up the BRICS nations haven’t recovered. In fact the economies of Brazil and South Africa have gotten worse. India has been the strongest member of the union, but even India’s GDP is starting to show signs of a slowdown, and Russia in certainly on the doorstep of a recession. Soros claims the Russians are in a recession, but like China that word isn’t how their governments describe what is happening economically in their countries.

The biggest warning came from China a few years ago when their manufacturing base started to collapse. China is having a hard time keeping prices down even though they are manipulating their currency to make than happen. The Chinese government is trying to keep their stock market stable, but Chinese investors are leaving the stock market in search for more productive assets. The government of China has put a stop to money leaving the country, so there is an enormous amount of unrest and fear in the Chinese marketplace.

The United States economy is still growing at a rate of more than 3.5 percent a year, but Soros thinks that will end during the second half of 2016. The U.S. stock market is experiencing trading ups and downs that will eventually lead to all downs, according to Soros. And even though the unemployment rate is tracking at 4.9 percent, that rate will go up in the first half of 2017. Oil prices are another sign.

The economies of countries around the world are feeling the impact of cheap oil. Soros sold all his oil stocks, and that means crude oil prices are not going to increase. Oil prices could stay where they are, but there is a chance prices may go down over the next 12 months. There isn’t much talk about a global recession in the United States political arena. The fast-talking politicians stay away from touches subjects like recessions even though the state of the economy is a priority in voters’ minds.